Skilling India: Challenging The Status Quo
'550 million trained resources by 2022': A target which shall challenge the resolve of the Indian Establishment in efficiency and "Good Governance". Governments, we dare say, due to their globalized ambitions to conquer the financial strength, give in to the hoopla of management of public finances. In its entirety, which Government would not like to take credit for billions of dollars shoring up as investment into reserves and pooled assets to showcase their money might?
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Even in case for Governments today, I dare quote Jerry Maguire, a famous late 90's Hollywood movie, or rather announce with an amplifying voice:
"Show me the Money"
But there lies a new perspective, one where key stakeholders take up new roles and make room for new thinking to deliver the goods as promised in the precursor to May, 2014. With 550 million + young Indians ready to move into workforce, our very own Arunesh Banerjee foresees an entirely new dimension to Skill Development: A business opportunity. Training people is an entirely different art, which quite necessarily involves an understanding of the expectations and hidden agendas of different stakeholders. The critical question is not whether people will get trained adequately; but the major cause of concern is- would my training courses be able to create enough Marketing pull, to kick-start, sustain and scale up the entire business model from region to region?
The second big issue: Capacity Utilization. Skills which are hard to leverage and provide with a sustainable livelihood to a subset of workforce.
To these issues, two big developments (to have happened to Indian populace) come to Arunesh's mind: Mobility and Platform, which raises some pertinent questions:
"Can we use our labyrinth of Telecom and IT to create a sustainable environment for providing skilled workforce? Can we really make our Industries and our People meet at one place?"
Facilitating Status Quo
The difference in thought process between the Government and the manufacturing sector is the evolution of skills and the burgeoning skill gap within the Labour-force of India. Now, as we are getting ready to become the 'HR Capital to the World', we need successive establishments to realize their act of being facilitators rather than being capitalists. This makes the role of a manufacturing unit bifocal when it comes to labour relation, where the unit pays for the training costs involved, incubates the resources and the resultant is a productivity lag, which may or may not be fully recovered. We need to acknowledge the role of facilitators as a connection between the unit and the workforce community. And what better than to create an organization which solely focuses on this connection. One of the bigger reasons why there should be another firm is because of the cost advantage realization to be achieved by ways of pooled investments and scale. And how this cost realization brouhaha can work, simple answer: Technology.
Cutting edge technology at ultra-low cost and availability of telecom network to the farthest corners of India creates a unique opportunity for Workforce facilitation sector to leverage upon. Indian populace in its hunt for value for money services skipped the PC revolution and moved to mobility.
The advent of ultra-low cost mobility provides a strong argument for the tablets to be used with ease even by the lowest earning members of masses, giving the impression that technology related outcomes are here to stay.
The next point of consideration is how to achieve scale in a short duration, and the answer to that question is concept of MOOC (Massive Open Online Courses). With customization, MOOC's can offer a distinct advantage of reaching the masses with specialized skillset at the doorstep, thereby "cutting the unnecessary flab". The only requirement and beauty of this game: courses need to stay relevant according to Industry requirements. The issue of pull of these courses can only be addressed by improvisation of content according to consumers.
The next issue which needs attention is the issue of Technology enabler devices and networks. The idea over here is to provide the end user with a handheld device at Rs 599/- per month, , inclusive of pre-installed industry-wise customized content to the unskilled working population in turn revolutionizing the way the end user treats training & enhancing capabilities without sustaining unnecessary capital damages to the client organization. This way we can ensure the unskilled workforce access to customized shop floor training, without incurring any boarding, travelling and other logistics costs. To counter the bandwidth hurdles, video compression technology can be roped in to deliver the right content.
Fine-tuned Business Model
The idea of using Technology as a tool to cut costs is not new and maybe called an overused proposition but consideration has to be made to the business proposition all the variables the Demographic Dividend and a business friendly government is throwing at us. Skilling people and in turn minting profits does make business sense provided the proposition can be scaled.
'Make in India' intends to deliver the investments but, 'Skilling India' will add the supplement to the muscular force of manufacturing powerhouses at the cusp of opening bases in India.
Let's try and exemplify this situation, if a company X wants to employ 2000 people, of spanning across 5 different skillsets. Our skill development organization ABC limited, shall deliver those 2000 at the doorstep of X with no delays to recruitment and training. If company X sets a deadline of 15th July 2016 to start production from place A, ABC with an unskilled workforce spanning across 20 different tier II towns and adjoining villages, through its regional centers provides the interested unskilled workforce an opportunity to undertake a basic refresher course of all the 5 skillsets required by company X, with a 4 week timeline for completion via devices like tablets.
The next set of advanced courses would require another 10 weeks to be delivered virtually by tablets. The point to be appreciated here is that, till this time, no costs other than the cost to technology are involved, which too is solely funded by the unskilled workforce audience, facilitated through easy EMI (Equal Monthly Installments) schemes or other financial assistance schemes from microfinance institutions. After the much required basic refresher course is over, the next vital step is to provide the practical training. This step requires the actual funding and that's where the opportunity lies for the Mr. Arunesh to raise equity capital on the basis of refresher course enrollments and necessary related parameters. The equity capital can be used upon to build necessary training labs and provide toolkits to the already well-prepared audience for a hands-on experience. The audience can be selected from the tests and refresher courses conducted at the regional centers which prove to be a funnel for churning out trained resources.
The next step is to formalize the training process at the nearest located Hub from the regional centers. At the hub of ABC organization, the professionals undergo the necessary training for technical, behavioral (basic), and standard operating procedures (S.O.P's) pertaining to the industry of their potential employer, the company X. This step may take anywhere from 6-8 weeks, with the costs of practical training borne by ABC organization, in turn funded by the respective employer.
Effectively ABC's aim shall be to develop into a dynamic yet rooted Labour Relations organization.
In 20 weeks' time, our skilled audience is ready to step up and become trained Labour professionals, with least of costs incurred by the employers who achieve productivity maximization for their specific industry in a much hassle-free manner. This maximizes gains for the unskilled workforce, by augmenting demand rather than creating a supply of not-so-required Labour-force.
Maximizing True Gains
The criterion for the selection of hubs is to base upon GDP year on year growth but the criterion of selection of regional centers is debatable. The major focus however, is not just the contribution of the cities to state GDP but, the level of skill already achieved by population, the stability in political dynamics, and the hunger of the successive generations to achieve growth. It will be in significant interest of the organization, to get a pulse of the surrounding people, so that as not to repeat the mistakes of the Maruti at their Manesar manufacturing plant, and in turn drive inclusive growth of the regional base.
The way technology unfolds shall govern the next decade for India. High performance technology implementations are expected to add close to $ 550 Billion to the economy. , but the way, India shall manage its skill in the workforce, skill her people shall govern the next three decades of the economy. Post-economic liberalization, if marketplace model for consumption-led growth was the way forward, then a marketplace model for professional skills, is the way to employ more and more people in a much efficient way. The kind of marketplace we are talking about shall be governed by hunger to grow the industrial output activity which declined by 4.1 % for the November, 2014. The key is in, not repeating the archaic ways, think in a multi-dimensional way rather than relying on one-way parameter.
The Multi-dimensional way lateral shall be sensitive enough to consider home driven consumption, IT sector reforms and subsequently, answer the question of export-led growth.
The next objective which proposed professional marketplace shall fulfill is to create an asset of pooled talent. This level of thought process shall take Mr. Banerjee, a serial entrepreneur, to a journey where Hindi hinterland and Far East corners of India shall come together, work together and grow together. This in long run has the potential to not only create economically independent states over a period of time but, even economically sustainable skilled professionals over the same period.
The key to success is designing the right blueprint and taking it effectively forward. However, things which Mr. Banerjee should be wondering about is not the potential of idea, but from where to begin all the execution work, which is the next right question, the answers to which only his experiences might yield in time!!
The authors are Jyoti Kainth, Assistant Professor at IMT Ghaziabad and Aditya Vashisth, Analyst at Royal Bank of Scotland
Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.